JERUSALEM — The CEO of IAI North America has big plans to expand, pointing to the subsidiary of Israel’s largest aerospace and defense company’s “Made in Mississippi” Arrow 3 anti-ballistic missile canister as only the beginning.
Swami Iyer, formerly president of Ultra Electronics‘ 3eTI subsidiary, who joined IAI North America in June, oversees operations at the company’s two subsidiaries: Stark Aerospace in Mississippi and Elta North America in Maryland. In September Stark rolled out canister as part of the indigenous production of IAI parts and programs that the company expects to expand — a key to the Arrow 3 program that receives U.S. funding.
The Arrow 3 received $310 million in funding from the U.S. for Arrow 3 in FY2018 and in FY2019 Congress has pushed for $80 million for co-production and $163 million for support that would include integration and interoperability with U.S. missile defense systems.
Iyer says that he expects to continue to fill the Stark factory with work.
“We are doing composite work for Boeing and others — composite air frames and air structure manufacturing, avionics and wiring," he said. "And we continue to expand those product lines and core competencies as the business grows.”
Serving this indigenous requirement of the Arrow 3 government-to-government agreement enabled the company to “open up more work for export for manufacturing in Stark,” he says. The manufacturing of the canisters at Stark supports more than 100 jobs in Mississippi.
With the U.S. accounts for around 75 percent of the market for IAI, Iyer has set about to rebuild his corporate team for a North American business approach, which he calls step one of a multi-step process going forward.
IAI’s North America lost $8 million in 2016 according to a report earlier this year. There are challenges ahead.
“Step 2 is legal constructs; we have the physical footprint but the legal [creation] of an American boards of directors allows us to represent an American entity in the U.S. and to bring intellectual property of IAI, to pitch the products we do currently and make sales at a price point and at a level that would gain more of a market share,” Iyer says. He foresees this next stage taking place over the upcoming years while the company explores businesses and acquisitions.
“We are taking a careful approach.”
At AUSA this week, IAI North America showcased almost a dozen products, including man packable drones and ELTA’s anti-drone UAS system. Iyer noted that IAI is supplying the U.S. Air Force with ELTA’s system and that it signed an agreement with Sierra Nevada Corporation to jointly approach the U.S. military with VTOL drones.
He stressed that one of the marketing assets for IAI is that its systems have been tested in the field in Israel and that when it comes to combat experience “ours is in the field.”
Seth Frantzman is the Israel correspondent for Defense News. He has been covering conflict in the Middle East since 2010. He has experience covering the international coalition against the Islamic State group in Iraq and Syria, and he is a co-founder and executive director of the Middle East Center for Reporting and Analysis.